Generative mechanisms of the World Trade Web

Kastelle, T. (2009). Generative mechanisms of the World Trade Web. In: Druid Summer Conference 2009 on Innovation, Strategy and Knowledge. DRUID Summer Conference 2009, Copenhagen, Denmark, (1-26). 17-19 June, 2009.

Author Kastelle, T.
Title of paper Generative mechanisms of the World Trade Web
Conference name DRUID Summer Conference 2009
Conference location Copenhagen, Denmark
Conference dates 17-19 June, 2009
Proceedings title Druid Summer Conference 2009 on Innovation, Strategy and Knowledge
Place of Publication Copenhagen, Denmark
Publisher DRUID
Publication Year 2009
Year available 2009
Sub-type Fully published paper
Start page 1
End page 26
Total pages 26
Collection year 2010
Language eng
Abstract/Summary There have been a number of studies recently which have analysed international trade as a complex network. Most of these have concluded that trade connections within the network show a power-law distribution. This is generally assumed to mean that the world trade web has grown through the generative mechanism of preferential attachment. If this is true, it suggests that one natural outcome of increasing trade is that the rich will continue to get richer. Using trade data compiled by the International Monetary Fund from 1938 to 2003, this paper uses longitudinal network analysis to determine whether or not preferential attachment is in fact the primary generative mechanism of growth within the world trade web. The actual case appears to be substantially more complex, with multiple generative mechanisms contributing to the growth of the network. While preferential attachment has some impact on growth, other factors such as relative network position and geographic proximity have a greater impact on the formation of new trading links within the network. This suggests that the relative position of a country within the trade network is not determined by its starting position, as is the case if preferential attachment is the dominant generative mechanism. Consequently, countries and innovative agents within the network have the ability to drive change within the world trade web.
Subjects E1
150308 International Business
910399 International Trade not elsewhere classified
Q-Index Code E1
Q-Index Status Confirmed Code

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Created: Mon, 15 Mar 2010, 12:56:40 EST by Karen Morgan on behalf of UQ Business School